Getting Tough on Exploitation

Vigorously enforcing labor law and stopping the crackdown on the nation's undocumented immigrants can boost the American economy.

By

November 17, 2009

Last week, Homeland Security Secretary Janet Napolitano announced that the Obama administration would seek legal status for 12 million undocumented immigrants in early 2010. Hard-right tea party organizers reportedly switched gears immediately to denounce the move. Congressman Lamar Smith found it “ironic” that Napolitano framed the push for comprehensive immigration reform as a way to improve the economy. But Napolitano is absolutely right: reforming the nation’s immigration laws to bring millions of people already participating in our economy out of the shadows would boost tax revenue, lift the economy and protect working Americans from the unfair labor market competition they now face. The biggest problem is that Congress may be dangerously slow to act: even the much-needed extension of unemployment benefits took the Senate months to approve.

While legislators drag their feet, the Obama administration can act quickly on its own to stop the erosion of middle-class jobs. Directing his agencies to enforce the nation’s existing labor and employment laws more vigorously, while halting the enforcement of broken, economically harmful immigration laws is one powerful way to do it.

To the uninformed, the relationship between unemployment and immigration looks simple: if we could just deport all undocumented workers and restrict legal immigration, those jobs would instantly become available to American citizens, driving down unemployment. But the old “immigrants steal American jobs” myth holds no water. The reality is that all types of immigrants, including the undocumented, boost the American economy as taxpayers, workers, consumers and business owners. Through their work and consumption, immigrants generate economic activity that creates new jobs, jobs that wouldn’t exist if immigrants were not part of our economy. As the President’s Council on Economic Advisors concluded in 2007, US natives gain $37 billion a year from immigrants’ participation in the economy. If enforcement efforts were effective and we somehow succeeded in pushing undocumented workers out of the country (not a likely scenario, even in these dark economic times), we would lose jobs rather than gain them.

But if the presence of undocumented immigrants doesn’t harm the US economy, the fact that they are so vulnerable to exploitation in the workplace does. Because undocumented workers are often too afraid of deportation to speak up about workplace abuses, unscrupulous employers can cut immigrants’ wages and benefits and degrade working conditions with impunity. Exploiting undocumented workers can drag down wages for other workers, especially those with little education: as their employers are forced to compete with companies that exploit immigrants, entire industries may see wages decline. Indeed, violations of minimum wage, overtime and workplace safety laws are rampant in the nation’s immigrant-dominated low-wage industries, according to a recent eye-opening study by researchers at UCLA, the University of Illinois and the National Employment Law Project. Their in-depth investigation in three American cities reveals that as many as one in four low-wage workers–including hundreds of thousands of American citizens in these cities alone–were paid less than the minimum wage in the week prior to the survey. And while undocumented immigrants appear to be the most vulnerable to abuses, this research vividly illustrates the way that exploitation of immigrants goes hand-in-hand with an atmosphere in which citizens are also taken advantage of on the job. As long as such violations persist, economic recovery will never reach these workers.

That’s why a shift from immigration enforcement to labor and employment law enforcement is so critical. Enforcing laws against undocumented immigrants–even by penalizing employers rather than raiding workplaces, as the Obama administration has chosen to do–increases immigrants’ fear and corrupt employers’ incentive to keep workers off the books. As a result, immigrants are driven further underground and see their risk for exploitation increases. In fact, immigration enforcement itself can be manipulated by employers to undermine all workers’ rights and continue to pursue workplace violations, as another recent study illustrates.

Legalizing undocumented workers is ultimately the best way to ensure that they can exercise rights in the workplace and stop undercutting other American workers. Once everyone participating in the US economy is openly subject to American labor laws, pursuing violations of workplace protections, including minimum-wage laws, will become easier. What’s more, an analysis of the mass legalization enacted in the United States in 1986 suggests that legalization would raise immigrant wages and lift up entire communities, boosting the US economy. Legalization would require an act of Congress, which may be slow in coming. But the Obama administration could unilaterally halt the enforcement of broken immigration laws, delivering tremendous economic benefits. As the Progressive States Network has pointed out, state governments can also improve conditions for workers by shifting enforcement emphasis from immigration infractions to workplace violations.

The Obama administration is moving in the right direction with the recognition that it is corrupt employers, not undocumented workers, who are a threat to the middle class, but it needs to focus on the real problem: not immigration violations but the exploitation that often accompanies them. While we wait for stronger economic recovery measures and the overhauls of immigration and labor law that American workers need, a shift in enforcement strategy can begin to provide an immediate boost to the economy and the nation’s hardest-hit workers.